CHITOSE, Japan—Malaysia Aviation Group’s growing ratio of new-delivery widebodies and narrowbodies is helping the carrier improve its fuel efficiency as it grapples with the surge in fuel prices.
The new Boeing 737-8s and Airbus A330neos are yielding fuel savings in the 12-14% range versus its older fleet types, MAG CEO Nasaruddin Bakar said during the CAPA Airline Leader Summit Asia event on Oct. 2. This is particularly important while fuel costs are so high, he said.
MAG ordered a total of 95 aircraft—55 from the 737 MAX family and 40 A330neos—for its fleet renewal and growth plan. Of these, 29 have been delivered and another 66 are due to arrive over the next five years. The delivered aircraft comprise 10 A330neos and 19 737-8s, all of which fly for subsidiary Malaysia Airlines.
More orders are expected soon, as MAG plans to announce its choice for a long-haul widebody replacement within 1-2 months, Nasaruddin said. This order campaign has been running for months, and MAG is now at the tail-end of the process, he said.
The carrier previously had a ratio of 67% narrowbodies to 33% widebodies, but it plans to have a ratio of about 50-50 once all of its ordered aircraft arrive. About 70% of its orders are intended for replacement, and 30% for growth, Nasaruddin said.
MAG has taken a range of measures in response to high fuel prices. Some of the increase has been passed on to customers, but the carrier has only been able to raise its fares by about 20% without hurting demand too much, Nasaruddin said.
Fuel hedging has also helped, and the carrier has cut its capacity by about 5%.
MAG estimates that the current level of fuel prices will continue for at least another three or four quarters, Nasaruddin said.
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